Some commentators have said Philpott’s lifestyle illustrates “all that is wrong” with the benefits system.

When asked if the Philpotts were a product of Britain’s benefit system, Mr Osborne said: “It’s right we ask questions as a government, a society and as taxpayers, why we are subsidising lifestyles like these.

“It does need to be handled.”

He said Philpott “was responsible for horrendous crimes, crimes which have shocked the nation”.

His comments came amid pressure from the Tory Right to restrict child benefit to two children per household.

Former Conservative leadership challenger David Davis told The Times: “I don’t think it is a good idea to make policy on the back of one story. But there is a strong argument to restrict child benefit whether it is to two, three, or four children.”

Government figures show that the vast majority of the 7.9m families claiming child benefits have just one or two children – some 6.7m families.

The number of claimants with three children is 901,685, while 239,055 claim benefits for four children and 86,235 claim for five children or more.

The HMRC figures do not break it down any further than that. However numbers obtained by a Freedom of Information Request last year show that the numbers drop significantly after five.

In May 2011 there were 8,780 claimants with six children, 3,200 claimants with seven children, and 1,080 with eight children.

The number of claimants with nine or ten children drops down to just a few hundred, while there were less than 100 claimants with more than 10 children.

The Work and Pensions Secretary Iain Duncan Smith has previously floated the idea of limiting benefits.

In the lead up to the Conservative Party Conference last year Mr Duncan Smith proposed a two-child cap on benefits.

He questioned whether jobless families should be able to expect endless support for every child they have, when working households have to make tough choices about what they can afford.

At the time, he was backed by Mr Osborne but the idea was quashed by the Liberal Democrats in the Autumn Statement

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